Category - Southern

The old Quonset hut situated near the I-5 freeway has been a fixture for decades in this southern Oregon town, but the energy level and innovation taking place inside is entirely new.

The Quonset also represents a calculated gamble that not only can manufacturing re-energize this rural Oregon community with good jobs and high return on investment, but that the business within – Roguewood Furniture Company– can compete with venture capital dollars that are most often associated with 21st century technology rather than old-school product making.

Harmony in discord

But don’t tell Elizabeth Bauer this gamble isn’t prudent. Her whole business is built on taking discordant ideas like this one: scaleable investment in rural manufacturing, or like this one: sustainable forest products, and making them not only meaningful, but profitable and of high community value.

Bauer, 37, is the president and founder of Gilded Rogue, an Ashland, Ore. investment company that launched last year. It has since purchased three southern Oregon businesses, including Roguewood and its retro Quonset hut.

“This is a good company that just needed a little bit of love,” she says of Roguewood.

Bauer came out of the grocery industry where she worked as a CFO for massive company with 2,700 employees and annual sales of nearly half a billion dollars. She said her time in corporate finance taught her that many businesses are lacking the language to compete for investment dollars.

“I’d hear all the time,” she says. “There is nothing to invest in. I know it isn’t true but I realized they are speaking different languages.”

Which lead to those seemingly discordant terms being merged together in an old-school business model that can attract cutting-edge investment dollars.

Embracing rural Oregon

“There is a lot of angel money for startups, but not as much for ready-to-scale investment. That’s our sweet spot,” Bauer says. “We’re really about accelerating. We’re trying to get companies out of that first stage and into stage 2 or 3 expansion.”

Bauer said the mission is straightforward and simple. They are looking for companies within the rural Pacific Northwest that have potential sales growth and potential social impact.

Both, she insists, are critical.

“The impact is built into the costs, say, like the wood we use,” she says, because compromising local impact would dissolve the mission. Each company under the Gilded Rogue umbrella must be focused on “benefiting a social issue and making a difference in the world,” according the company’s website.

Building on what works

“The do-good stuff is more than a slogan in the daily operations of Roguewood. It translates in observable ways into the work place, just as when Quin Wilson, a Roguewood furniture designer, returned from a hunt for reclaimed wood. Wilson described the value of the large beams he brought back like trophies of his latest expedition.

I got this out of a saw mill they are tearing down in Klammath Falls,” he said.

He struggled to hold the massive beam—perhaps a 2×12 to an inexpert eye—on its end.

“See how tight that grain is. New timber today may have as much as 1/3 of an inch gap. But this is so much higher quality…” Wilson explained, then segued seamlessly into his plans for converting the beams into a new artisan table.

Wilson plans to smooth out the grain (“just a little, so it’s smooth, but still looks right”) and fill in some holes. On the spot he bought a significant amount of the wood on site and dragged plenty back in his truck.

“How much?” Bauer asked.

“$2.50 a square.”

“Very nice,” she said.

Wilson was also excited about a new wood he’s exploring as a potential product.

“I just found another type of wood I think we might want to take a look at. It is yew wood. It’s a salvage wood. It has a lot of potential,” he reported.

Bauer encouraged him to take a look. No micromanaging here. That freedom, Bauer says later is a big factor in Roguewood’s plan. Bauer, who is now serving as the company’s CEO, is building the business around the craftsmanship and quality that already existed. The employees will be the eventual owners, so autonomy now—with a guiding hand on the business side—is critical. Empowerment is a big part of the growth strategy.

“It’s like putting floaties on a company instead of tossing them into the deep end,” Bauer says.

Economic Rebound

Based on the early explosive growth under Bauer’s leadership, Roguewood won’t need the floaties for long. The word is out in the community as well. Former employees are returning, applications in hand.

“I shouldn’t have left,” one man says as he quickly dropped off his application.
Inside the Quonset hut energy and activity hums. Different sections are used for making different products. The smell of steel saws burning through hard wood mixes with the noise of machines in high gear. But the relaxed vibe of the work represents more high-school woodworking class than high-pressured manufacturing.

In October Roguewood hit $250,000 in sales and ramped up to 60 employees, up from $120,000 in sales and 17 employees back in July. November sales will hit $350,000, Bauer says.

“We just need to get them out the door,” she says of recent sales.

November will also be the first month of a new strategic partnership with Sawyer Paddles and Oars, which agreed to move its manufacturing into the Roguewood site. Employees will be able to cross-train in both furniture manufacturing and paddles, according to Sawyer President Peter Newport.

“I think Liz is an amazing leader,” Newport says.

The partnership fits with what industry experts say is the future of American manufacturing. John Bova, director, MTN Capital Partners LLC, told Industry Week streamlining is the future of American manufacturing.

“The types of decisions that needed to be made include streamlining of go to market, successful new product introductions from a strong pipeline and steady global business investment. Those will be key characteristics for manufacturers poised for higher growth levels,” Bova said.

Lead with sales

It’s all part of the process Bauer envisioned when she first focused on Roguewood.

“Sales came first,” Bauer says. “Then came the employees. Now we’re connecting all the dots,” said Mariam McVeigh, Roguewood’s director of sales. She shares that the arrival of Bauer and her team has infused the company with creative energy.

“It’s like my handcuffs came off,” she says. “The potential always has been there. We have the product and quality and we have the reputation. Now we have the possibility.”

McVeigh used her personal connection to an employer at the Wild River Brewing Company to land a new account. Shaun Hoback, manager of the brewing company, said he just signed a contract with Roguewood for new dining room tables and matching décor that includes old photos of the mills in town and new sustainable products made there including Sawyer paddles.

“Those paddles are gorgeous,” Hoback said. “We want to connect first and foremost with local companies. But the story behind the wood, the company, the industry here, all plays a part in why we want to do business with them.”

Bauer also brought in a team of professionals to help Roguewood organize its front office. One of those is Sam Leaber, systems administrator for Gilded Rogue, on loan to Roguewood.

“Companies don’t always know what they need until it all goes wrong,” he says.

By having Leaber available, Roguewood can improve its online presence without the added cost of a full-time IT guy. Bauer’s husband also pops in, helping out with any number of tasks as needed.

“The more we do this kind of stuff,” Bauer says, arms sweeping across the spartan office space, “the more they can do what they do best, building a great product.”

Significant impact

For all the business savvy, the mission remains impact-centered, much like Wilson’s hunt for reclaimed wood and Bauer’s determination to build a solid, permanent workforce. It also is evident in the exit strategy Bauer has in mind, which is to eventually sell the company to the employees themselves.

Because the company was undervalued and is now getting the lift it needed it should soon hit industry standards, Bauer says. That realized growth will allow the employees to buy her out. It means a company will sustain in the community that gave it life and will benefit that community long after Bauer is on to other projects.

Bauer knows profits are critical. But unlike much of the venture capital world that is looking for the explosive dividends of tech companies that require 10 times the amount invested in returns, Bauer says the same return can be realized with a lower rate of growth with fewer failed investments.

“There are a lot of companies out there that don’t fit the 10x model,” Bauer says. “But we sort of put them together to outperform that model. We don’t have the eight in ten failure rate to absorb. It allows us to succeed.”

It also allows them to continue to make an impact, like donating money to the Ashland-based Lomakatsi non-profit that educates children about forest health. For every piece of furniture Roguewood sells, Lomakaski is given money to plant a tree, Bauer says.

Bauer says the company must excel and the impact must be reflected in the product, which “drives money into impact.”

She says the overall aim of the company is connecting the diverse artisan craftsmakers in the Pacific Northwest to the burgeoning market of clients across the globe.

“If we can do wood products right, in a sustainable way, here in Southern Oregon, in timber country, well that’s a great model for everyone,” Bauer says.

It’s rare to use the words “hot tub” and “great idea” in the same sentence. But those two seemingly incongruous terms came together on a pivotal day in August 2010. Lem James relaxed in the hot tub with his son discussing business and life, which wasn’t unusual for the pair.

Lem had spent the last several years seeking the perfect startup idea—a niche idea to be exact, so the conversation focused on startup ideas to opportunities. He had watched and compared businesses inside very competitive markets and niche markets. But nothing had quite fit the mold.

Lem recognized a viable product and innovative idea. Permanent, outdoor table tennis tables took something familiar and turned it on its head. Lem liked the purposeful creativity of combining ping pong and concrete—two things that didn’t seem to mesh—to create a new outdoor experience in public places.

But this would be more than a niche market; it would be wide open without any competitors and an immediate customer focus; Parks & Recreation.

From a fleeting idea, a permanent table

Normally, “outdoor” ping pong tables need to be set up every day and put away at night. This, combined with play, causes them to wear out every few years. Left outside, table tennis tables deteriorate rapidly.

A concrete table, however, can stay outside through harsh weather and doesn’t need to be set up and taken down at all. This was the key.

Concrete tables could save money for parks, military bases, community centers, and even home owners. Using concrete completely redefines where table tennis works. Instead of backyards and garages, tables can be installed in parks and outdoor school yards.

Forming a business as sturdy as its product

Within a week, Lem had AutoCAD sketches and plans to build forms. As he shared his idea, however, others raised concerns. Who would buy these concrete tables? Wouldn’t shipping costs eat up any profit? Who would even think to search for a product like this? America just wasn’t familiar with the idea. It was a luxury item and, in 2010, we were in a recession.

With his work experience, Lem knew parks across the country and beyond would be interested, and he knew the channels to reach them. As for shipping, that’s a normal cost of doing business. Even when others shared their concerns, the passion grew.

“Every once in a while, we had to do a gut check because they were putting out a few quotes but nothing was selling yet,” said Lem. “We had to hone in on our product and our marketing to put our products out there to our target markets without traditional advertising. We began selling a table here and there. Then, once we could put enough story and photographs together to show tables in parks, schools and nice backyards, sales started rolling.

“It’s frustrating to watch potentially good businesses start and poke around, and then evaporate before they even get the traction to move forward. I’ve watched several businesses fail to launch in this manner. Many times so much time gets spent on making a perfect product that marketing and sales get ignored.

“A lot of these businesses get launched by very smart successful people, but people who don’t need the business to succeed. They have other successes that are easy to fall back on. Early on, a friend asked what my back up plan was. I said plan A was to succeed wildly, and plan B was to succeed mildly. There was no backup plan to fail. If we ran into failure, we would plan around it and continue. Don’t quit.”

During the first year, the company focused on developing and improving the tables, adding steel nets, integral concrete dye to offer color options, and making other refinements. Concrete chess tables were a natural addition to the product line, and these weren’t as foreign to the American market. The playing squares are marble inlaid tiles in a background of polished, exposed aggregate concrete in an array of color options, including recycled glass.

Why Oregon?

The entrepreneurial community in Oregon supported Bravado from an early stage, including the Roseburg Small Business Development Center and Young Entrepreneur Society (YES), a Roseburg group that supports new innovation.

These groups provided the cross pollination of ideas, which has been central to Bravado’s product development and marketing. In addition, they provided crucial support to a founder with a unique concept. Lem was able to pitch ideas and get feedback from a unique cross section of business thinkers and fellow entrepreneurs.

Oregon is also home to an array of groups, like Portland based City Repair, who are great supporters of the placemaking movement. City Repair builds community projects—like turning an intersection into a public park. They describes placemaking as “a multi-layered process within which citizens foster active, engaged relationships to the spaces which they inhabit, the landscapes of their lives, and shape those spaces in a way which creates a sense of communal stewardship and lived connection.”Permanent outdoor games—especially table tennis—fit in perfectly with placemaking by providing the community a gathering point where everyone can play.

Best of both worlds

As Lem perfected the engineering and production of the ping pong tables, his mind began to turn to other product opportunities based on the company motto, “Everybody plays!”

Cornhole, a simple, but not very well known game immediately came to mind. The bean bag game was easy to adapt to concrete and place as a permanent feature in parks, while also creating a more entry level product line. Foosball was added to the product line after a table tennis fan sent a picture of a similar table in Paris. While the actual forming and production took some fine tuning, the actual game itself is to pick up and learn.

Foosball and cornhole allow almost anyone to begin playing and then develop mastery over time—just like the sport that inspired the original product.

Work that inspires activity

Lem shares a contagious enthusiasm for his products and the games they facilitate. it’s not just about selling something and making money. These tables are on the cutting edge in concrete work, the placemaking movement, and the sport of table tennis.

Bravado Outdoor’s table tops are recognized in the concrete industry for design and finish work and have been featured by different suppliers. The tables are another example of combining two different disciplines: concrete engineering and concrete countertop finish work.

These publicly available tables support the developing of ping pong in America, and integrate into the urban placemaking design movement; where sidewalks, corners or small urban spaces are turned into an oasis where people can gather. Where an old empty lot can become a miniature neighborhood gathering spot with ping pong and chess as the focal points.

The sport of table tennis, in particular, has been a second tier sport in North America, usually played in garages and basements. But Bravado is taking table tennis into the outdoors and public places, putting the sport front and center and giving more people across America and the chance to hone their skills. The Bravado team strongly believes that by making table tennis more accessible, the level of play will be raised—ultimately helping the US become more competitive on the international scene.

Lofty goal? Sure. But the accessibility of basketball courts in parks and urban areas has definitely played a central role in the development of many top players, and while there is a big difference between basketball and table tennis in regards to the idea of being a competitive sport, accessibility and awareness are still critical development steps.

And once in place, these tables will be around for years to come. No nets to replace or backboards to repair. No play structures to fix. No swing chains to replace. Just hours of enjoyment by kids and adults alike.

And much like the products they have developed, Bravado has created a solid company, firmly grounded in the community that supported them from the beginning.